PM Transcripts

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COMMONWEALTH GOVERNMENT.
DIGEST OF DECISIONS
AND ANNOUNCEMENTS AND
IMPORTANT SPEECHES
BY
THE PRIME MINISTER
( THE RIGHT HON. J. B. CHIFLEY).
No. 135.
PERIOD 24TH MARCH, 1948, TO 10TH MAY, 1948.
By Athoity:
L P. Jo( wmro. Commonwealth Government Printer. Canbims
( Printed in Autralia.) r.
2565.

SECOND CHIFLEY MINISTRY.
On 6th April, 1948, the Prime Minister ( Mr. Chifley) announced
changes in certain Ministerial duties. The Government was then
constituted as follows
Prime Minister and Treasurer
Minister for External Affairs and
Attorney-General
Minister for Labour and National
Service
Minister for Air and Minister for Civil
Aviation
Vice-President of the Executive Council
Minister for Supply and Fuel
Minister for Post-war Reconstruction,
Minister for Defence, and Minister-incharge
of Council for Scientific and
Industrial Research
Minister for Transport and Minister for
External Territories
Postmaster-General
Minister for Information and Minister
for Immigration
Minister for the Interior
Minister for Health and Minister for
Social Services
Minister for Commerce and Agricultuxe
Minister for Works and Housing
Minister for Supply and Development
Minister for the Army
Minister for Trade and Customs
Minister for the Navy
Minister for Repatriation Mr. J. B. Chifley.
Dr. H. V. Evatt.
Mr. E. J. Holloway.
Mr. A. S. Drakeford.
Mr. W. J. Scully.
Senator W. P. Ashley.
Mr. J. J. Dedman.
Mr. E. J. Ward.
Senator D. Cameron.
Mr. A. A. Calwell.
Mr. H. V. Johnson.
Senator N. E. McKenna.
Mr. R. T. Pollard.
Mr. N. Lenmnon.
Senator J. I. Armstrong.
Mr. C. Chambers.
Senator B. Courtice.
Mr. W. J. F. Riordan.
Mr. H. C. Barnard.
PARLIAMENT.
REPRESENTATION-AUSTRALIAN CAPITAL TERRITORY.
On 5th April, 1948, the Prime Minister ( Mr. Chifley) said-
The question of according representation in Parliament to residents
of the Australian Capital Territory was considered by the Commonwealth
Government in September, 1944, and the decision was
deferred, the then Prime Minister ( Mr. Curtin) indicating that the
matter would be approached again after the war and after the taking
of the census. A deputation from the Citizens Rights League of
Canberra has since waited on me and renewed the request that residents
of the Australian Capital Territory be accorded representation in
Parliament. 2565.-2

Cabinet to-day decided to make a recommendation to the Federal
Parliamentary Labour party that the Australian Capital Territory
should be given representation in the House of Representatives on the
same lines as is accorded to the Northern Territory."
REPRESENTATION-INCREASED MEMBERSHIP, BILL
INTRODUCED:
In Parliament.-On 16th April, 1943, the Attorney-General ( Dr.
Evatt) introduced the Representation Bill. Dr. Evatt said-
The purpose of this bill is to enlarge the Commonwealth Parliament.
During the first ha] f century of Australia's history as a nation,
its population has more than doubled. During these years there has
been a great expansion, under the stimulus especially of t-wo world wars
and a world depression, of the responsibilities borne by this Parliament.
The purpose of the bill is to enlarge both Houses of the Parliament so
that its numbers will be more in keeping with these fundamental
iwtors in our political life.
' 1To function efficiently, a democracy must devise a system of representaslon
of the people in which the diverse views and interests of the
community can find expression. This cannot be achieved if the number
orepresentatives is too small. There is no automatic scale of numbers
of areas for securing the best democratic results. Nevertheless, it is
clear that Australia has altogether outgrown. the small Parliamentary
bodies with which the federation was equipped in 1900. How small
numerically is the Commonwealth Parliament, in comparison with some
of the State legislatures, can be seen from the following figures:
Legislative Legisative
Cnujcl. Assemnbly.
New South Wales 60
Victoria 34
Senate. Representatives.
Commonwealth 36 74
" The Constitution empowers Parliament to increase the size of the
Parliament if it thinks fit, but, : ys down certain conditions which must
b'e observed. The most -important of these conditions is that the number
of members of the House of Representatives must always -be as nearly
as practicable twice the number of senators. If, therefore, the number
of representatives is to be increased there must of necessity be a
correlative increase in the number of senators. Accordingly, this bill
effects an increase of the number of senators, with the appropriate
correlative increase of the number of members of the House.
The bill provides that there shall be ten senators for each State
instead of six. Thus, the total number of senators will be increased
from 36 to 60. Authority for the proposals contained in the ' bill is
provided by the Constitution which sets out that the Parliament may
make laws increasing or diminishing the number of senators for each
State, but so that equal representation of the several original States

shall be maintained, and further, that whenever the number of -senators
lb increased, the Parliament may make such provisions for the vacating
of the places of senators as it deems necessary to maintain regularity
in the rotation.
The Constitution lays down that the number of members of the
House of Representatives shall be, as nearly as practicable, twice the
number of senators. Therefore, if the number of senators is in-creased,
as provided in the till now presented, the number of members of the
House of Representatives must be correspondingly raised to a number,
as nearly as practicable, twice the number of the senators. The actual
number will probably be 121.
Pursuant to the Constitution, and the Representation Act, the
actual increase of the number of members of the House of Representatives
which will follow the passing of this bill will be from 74 to 121.
There will be no change in Tasmania, but in the other States the
numbers will increase as follows-
New South Wales-from 28 to 47.
Victoria-from 20 to 33.
Queensland-from 10 to 18.
South Australia-from 6 to
Western Australia-from 5 to 8.
" Since the establishment of the Commonwealth the population of
Australia has more than doubled. It has increased from 3,765,339
in 1900 to 7,580,820 in 1947. At the 1903 Senate elections 1,893,586
electors were enrolled. To-day the number is 4,780,334, or more than
two and a half times as many. In 1903, in the aggregate there was one
senator for each 52,596 electors. To-day the ratio is one senator for each
132,787 electors. If the number of senators is increased to 60, the
ratio at the next elections will be one senator to each 83,000 electors
approximately, which is less, proportionately, than in 1903.
In 1903, each member of the House of Representatives represented,
on an average, 25,247 electors. To-day, the average is 64,599, whilst
if Tasmania is omitted, and allowance made for the expected rise in
enrolment in the meantime, the average for the mainland divisions
towards the end of this Parliament will be about 69,000 electors. However,
if the number of members of the House of Representatives be
increased. to 121, the average number of electors per member at the
time of the next elections will be reduced to approximately 41,300, or,
omitting Tasmania, 41,680.
" It is proposed to bring the Senate up to the full strength of
senators as from the day of the first meeting of the Parliament after
the next dissolution of the Rouse of Representatives. This will be
necessary in order that membership of the Senate shall, from that date,
be approximately half of that of the House of Representatives as is
provided in the Constitution. Accordingly, the bill provides that apart
from any long casual vacancies that may have to be filled, seven senators
shall be chosen in each State at the next elections.

Four of the new senators elected in each State will take office
as from the date of the first meeting of the Parliament after the
elections, and, according to the order of their election, will continue
in office until 30th June, 1956, or 30th June, 1953. The 4: 2 new
senators, together with the eighteen who will not retire for a further
three -years, will bring the Senate membership up to
" Under the present system, three senators will be elected for the
ordinary six-year period of office which will commence as from 1st
July following; that leaves four more to be elected. At each subsequent
election of senators, five senators will normally be elected in each State,
making 30 to -be elected at each periodical election." [ The bill was passed.
( Far earlier references, please see No. 134, page 28.)
ELECTORAL ACT-PROPORTIONAL REPRESENTATION,
SENATE, BILL INTRODUCED.
In Parliament.-On 16th April, 1948, Dr. Evatt introduced the
Commonwealth Electoral Bill. Dr. Evatt said-
The purpose of the bill1 is to make provision for the application
of proportional representation to the election of senators. Before
1918, senators were elected by what is termed the first past the post
method. Each voter was required to place a cross in the square opposite
the names of the candidates for whom he desired to vote, the number
of crosses permitted being confined to the exact number of senators to
be elected. Thus where three senators were required the three
candidates with the greatest number of crosses were chosen, and as
was usually the case the three elected were candidates of the same
party. " In 19418, the ' preferential block majority' system was introduced
in respect of Senate elections. This system continued the principle
of the old ' first past the post' system in that under it all seats in a
State generally go to the party, or combination of parties, favoured
at the time by a bare, or simple majority of the electors. It might
he described as the all or none system, either all or none of a party's
candidates being elected. The system used since 1918 may he considered
an improvement on the old system only to the extent that it ensures
majority representation as against possible minority representation.
The great defect, from the representation aspect, of both the
first past the post and the block majority'I system is that at an
election, generally all seats in a State have been won by candidates
of the one party, leaving a minority of between 40 to 50 per cent.
of the electors without any representation at all in the Senate. For
many years there has been a demand that the Parliament should
provide a system of electing senators which would give more equitable
results and enable the electorate to be more truly represented in the

7
Senate. The Government has decided that, in relation to the election
of senators, where each State votes as one electorate, the fairest system
and the one most likely to enhance the status of the Senate is that of
proportional representation.
The bill sets out in detail the method of counting to be adopted
in respect of future elections of senators. The method is generally in
accord with the practice laid down by the Proportional Representation
Society. All I need say about the principle is that the name of the
system indicates the result intended to be achieved, that the electors
will be represented, in the number . of those elected, approximately
proportionately to their expression of opinion. For example, if five
are to be elected and one party's candidates poll 55 per cent. of the
total votes, the result would ' be that that party would have three
candidates elected, and the remaining two elected, assuming that only
two parties contested the poll, would be candidates of the opposing
party and they would represent 40 per cent. of the electors. This
system follows closely the provisions contained in the Proportional
Representation Bill 1912 ( Great Britain) and the system employed in
respect of municipal elections in Britain and South Africa. It is
virtually identical with the method used in the election of the
Parliament of Eire and is similar to the system employed in respect
of parliamentary elections for the New South Wales Legislative
Assembly from 1920 to 1925. In principle, the method proposed is
the same as that used in Tasmania although for reasons of workability
and simplicity it differs slightly in its practical application.
It is not proposed to alter the existing style of Senate ballot-paper
nor the provision that candidates may be grouped thereon with their
names in such order within the group as they desire. Nor is it intended
to vary the requirement that voters must indicate the order of their
preference for all the candidates. Whilst this latter requirement might
have the effect of continuing to produce a fairly high informal vote,
it definitely precludes the possibly greater evil of exhausted votesthat
is, votes which become exhausted in the process of transfer. If
a voter were to indicate his preference for only three of, say, seven
candidates, his vote would be effective up to the number of preferences
shown on his ballot-paper and after that it would be effective nd longe'r.
At that stage, the vote would be said to be exhausted. In Tasmaniaa,
the elector need not vote for all candidates and therefore on occasions
a fairly high percentage of votes becomes exhausted in the process of
transferring the votes of a lower candidate or the surplus of a higher
candidate to the next candidate in order of preference. One result of
a system which does not require the electors to vote for all candidates
whose names appear on the ballot-paper is that a candidate may be
declared elected although the total number of votes credited to hifm
falls, shot of the required quota. At the parliamentary elections in
New South Wales in 1922 and 1925, the exhausted votes, which far
outnumbered the informal votes, were the cause of much dissatisfaction
and disputation.
2565.-3

" The bill prescribes the manner in which the several vacancies
shall be filled. As hitherto, the count will be carried out under the
direction of the Commonwealth Electoral Officer for the State concerned
in thc offices of the respective Divisional Returning Officers. For
instance, in New South Wales, where there are 47 divisions, there -will
be 47 points at which the count will be carried out. This will ensure
completion of count with the greatest safety, The maximum of speed
and the minimum of cost. When the Commonwealth Electoral Officer
has received the final results of the count of first preference votes from
all returning officers and has totalled them, he will determine a quota
by dividing the total number bf first preference votes by one more
than the number of candidates required to be elected and by increasing
the quotient so obtained by'one. That appears to be complicated, but
if in New South Wales, for example, there were 1,600,00 valid votes
and seven senators had to be elected, the total number would be divided,
not by seven, but by eight, giving a quotient of 200,000. This would
give a quota of 200,000 plus one.
This formula for determining a quota, which, in effect, produces
the lowest number which, when multiplied by the number of candidates
to be elected, leaves a remainder of votes less than that lowest number,
is the one recommended by the Proportional Representation Society
and is used in Tasmania, in Fire, and generally in all places in British
communities where proportional representation has been applied. Any
candidate who, either on the count of the first preference votes or at any
subsequent stage, obtains a number of votes equal to or greater than
the quota shall be elected, and until all vacancies have been filled, the
surplus votes-that is, any number in excess of the quota-of such
elected candidate will be transferred in the manner set out in the bill
to the continuing candidates in strict proportion to. the voters' next
preferences. " The method of disposing of an elected candidate's surplus votes
prescribed in the bill is the one recommended by the Proportional
Representation Society and is precisely the same as that used in Fire
and in municipal'elections in Britain and South Africa, and it is similar
to the method employed in oonnexlon with the parliamentary elections
in New South Wales in the early nineteen-twenties. It differs from the
Tasmanian practice in that whereas in Tasmania all the votes of the
elected candidate are transferred at a fractional value so that every
single paper is looked at under the proposed method only such number
of votes as equals the surplus, taken in strict proportion to the preferences
on the whole of the votes of the elected candidate, are transferred.
No doubt that provision will require some consideration in
committee. It is thought that the Tasmanian system, while suitable
where the number of votes is comparatively small and all such votes
are concentrated at one centre, is not readily capable of being efficiently
worked by too remote a control. Consequently, to employ that system
at a Senate election, it would first be necessary to assemble the whole of

the ballot-papers for the State at one centre. Not only would this delay
completion, involve risks of loss in transit, and increase costs heavily,
but also in the larger States the Commonwealth Electoral Officer would
be faced with the almost insuperable task of securing for a period of
several weeks the extensive accommodation, equipment and staff needed.
" While it might be claimed that the Tasmanian system is mathematically
more exact, tests that have been made reveal that a similar
result is obtained by the employment of the method proposed. As an
illustration, I shall state a hypothetical case in New South Wales and
for this purpose I shall assume for the moment that a Labour candidate
has received 900,000 votes of the total number of 1,600,000. The quota
being 200,000, he has a surplus of 700,000 votes for distribution. This
would usually result in three full quotas being obtained for other candidates
on the list. The proposal embodied in the bill is that the officers
will not look at all of the votes. They will take the surplus available
and will assume that the No. 2 vote, which would be the effective vote
in the first instance, would reproduce a proportion in respect of the
surplus of 700,000 that would be true of the total of 900,000. Tests
have shown that the result would be the same as if all of the 900,000
votes were scrutinized. Questioned as to the likelihood of difference,
eminent mathematicians advised the Proportional Representation
Society of England that-
Whenever a considerable number of votes is in play the element of chance
involved is so small as to be negligible.
" Dealing with the point in its comprehensive report on electoral
systems, the British royal commission of 1908 said-
The chance of the result being affected is too small to be seriously considered.
We agree with the Proportional Representation Society that the additional
labour involved ( in the Tasmanian system) is greater than it is worth.
The bill further provides that if after the count of the first preference
votes or after the transfer of the surplus votes of an elected
candidate at any stage, no candidate or less than the number required
to be elected has or have obtained the quota, then the candidate with
the fewest votes shall be excluded and the whole of his ballot-papers
transferred to the continuing candidates; and if thereupon no candidate
has yet reached the quota, the process of excluding the candidate with
the fewest votes and the transferring of his ballot-papers will continue
until a continuing candidate has received a number of votes equal to
the quota or in respect of the last vacancy a majority of the votes.
Where candidates are elected at the same time, the order of their election
shall be determined to the extent of their surplus votes. The candidate
with the largest surplus shall be the first elected and so on. The same
principle will apply in relation to the transfer of surplus votes. The
largest surplus will be transferred first and so on. If on any count two
or more candidates have an equal number of votes and one of them has
to be excluded the Commonwealth Electoral Officer shall decide the
candidate to be excluded, or if two or more candidates are elected with
an equal number of votes the Commonwealth Electoral Officer will

decide the order of their election and the transfer of their votes, or if
in the final count for the filling of the last vacancy two candidates have
an equal number of votes, the Commonwealth Electoral Officer will
decide which shall be elected but that except as so provided the Coinimonwealth
Electoral Officer shall not vote at the election. That is
really the last resort. The chances against its happening in a Senate
election are enormous.
The result of the system is clear. There will be two major groups
of political parties, and seven senators will be elected, in the absence
of any casual vacancies, in each State. The party which secures 53
per cent. or .55 per cent. of the aggregate votes will, provided the party
ticket is followed, have four of the seven candidates to be returned.
The three remaining seats will be filled by the candidate from the other
party which secured 47 per cent. of the votes. That is certain".
[ The bill was passed.
CANBERRA.
FURTHER DEVELOPMENT.
On 5th April, 1948, the Prime Minister ( Mr. Chifley) said-
" In ' September, 1947, the Minister for the Interior ( Mr. Johnson)
arranged for a committee consisting of representatives of the Public
Service Board, Departments of the Treasury, Works and Housing and
Interior, to discuss proposals for the future development of Canberra.
Cabinet to-day considered the committee's report and made the following
decisions:-
ADDITIONAL DEPARTMENTS.-The first stage of from one to three years involving
the transfer of 882 officers to Canberra; the second stage of three to five
years involving the transfer of 1,703 officers of the Departments of Repatriation,
Social Services, Labour, Civil Aviation, Transport, Works and jHousing, the
Office of Education, the War Service Land Settlement Division, the Public Relations
Division, and the Re-establishment Division of the Department of Postwar
Reconstruction: the third stage of five to seven years involving 772 officers
of the Postmaster-General's Department, the Meteorological Division of the
Department of the Interior, the Grants Commission and Tariff Board; the fourth
stage of seven to ten years involving 3,670 officers of the Departments of Defence,
Navy, Army, Air, Munitions, Supply and Shipping, Secondary Industries Division
of the Department of Post-war Reconstruction and the Defence Division of
the Treasury.
ADLINISTATIVE BUILDINo.-The question of a second building to house additional
departments to be transferred and to cope with the extension of permanent
departments ( on lines similar to the one already approved) will be considered
by the Cabinet sub-committee appointed to deal with the dispersal of Government
buildings.
CLUB HOUSE.-A Club House to be erected by the Government to cater for the
needs of young male and female officers living in boarding houses and the like.
The club to be run by a committee of the officers. It may be possible to extend
facilities of the club to young persons not employed by the government.
JEBvIS BATY.-Cabinet had already decided that this area should be developed
as a tourist resort and that a short route trunk road between Canberra and
Jervis Bay will be taken up with the New South Wales Government.
NATIONAL CAPITAL PLANNING AND DEVELOPMENT COMMITTEE AND CIVIC
BRANCH OF THE DEPARTMENT OF THE INTERIOI:.-T'i'? organization to accelerate
the work of the committee is under consideration.

Civic MANAGEMENT.-An inter-departmental committee considered the constitution
and powers of the Australian Capital Territory Advisory Council and
the appointment to various boards and committees of non-official persons. If a
suitable person can be found an appointment will be made so that an investigation
could be carried out into the present system of management in Canberra.
MOUNTAIN AND SEASIDE RESORTS AND TOURIST FAOILITIE.-A suitably qualified
person will be obtained to report on this matter and also on the question
of development of facilities to attract tourists.
ESTABLISHMENT OF INDUSTRY.-This matter will be referred to the Secondary
Industries Commission for advice."
WAR WITH JAPAN.
OCCUPATION FORCE-COMMITTEE'S INQUIRY.
On 5th April, 1948, the Minister for the Army ( Mr. Chambers)
announced that a committee of investigation had been appointed to inquire
into allegations of immorality and black marketing among
British Commonwealth Occupation Forces troops in Japan. The party
included Chaplains-General the Revs. T. McCarthy ( Roman Catholic),
A. H. Stewart ( Presbyterian), A. Brooke ( United Churches), Major-
General C. E. M. Lloyd, and Mr. J. M. Stanley.
PUBLISHING INDUSTRY.
On 5th April, 1948, the Prime Minister ( Mr. Chifley) said-
In December, 1946, after considering a report on the publishing
industry prepared by the Tariff Board, Cabinet appointed a subcommittee
consisting of the Ministers for Post-war Reconstruction
( Mr. Dedman), Information ( Mr. Calwell) and Health ( Senator
McKenna) to consider and advise on means of assisting this industry
other than those means coming within the province of the Department
of Customs. In March, 1948, a meeting of the Cabinet sub-committee, with the
Minister for Customs ( Senator Courtice) attending, examined a report
made by an inter-departmental committee on the subject.
" Cabinet decided to-day that a committee comprising the Director
of Education ( Professor R. C. Mills), the National Librarian ( Mr.
H. White) and Mr. A. J. Day of the Department of Commerce, to
investigate and recommend to Cabinet on suitable means of assisting
this industry. The Department of Customs will provide an executive
officer for the committee." WESTERN AUSTRALIA.
WATER . SOHEME.
On the 5th April, 1948, the Prime Minister ( Mr. Chifley) said-
Cabinet decided to-day that the Commonwealth Government should
provide assistance towards the cost of a scheme to reticulate water to
certain rural areas of Western Australia, to towns along the Great
Southern Railway and to increase the supply to the eastern gold-fields
areas. This proposal has been the subject of representations by the
present and previous Western Australian Governments.

The estimated cost is œ 4,300,000 spread over a six years' period
and the Commonwealth proposes to meet half the capital cost, flue to
shortages of -plant and materials, it may not hbe possible to commence the
work for some time." ANTARCTI CA.
POLAR RESEARCH INSTITUTE.
On 5th April, 1948, the Prime Minister ( Mr. Chifley) said-
In 1913, the Scott Polar Research Institute was established at
London in memory of the late Captain R. F. Scott to promote polar
research work and -exploration. Recently, the institute asked the
British Treasury for a further grant to increase its income. Cabinet
decided to-day that a grant of œ E500 be made to the institute, continuation
of the grant to be reviewed after a year."
AUSTRALIAN EXPEDITION-PROGRESS.
On 5th April, 1948, Mr. Chifley said-
"' Cabinet to-day considered a report on the progress of the Australian
antarctic expedition.
" Cabinet decided that the scientific and meteorological bases successfully
established at Heard and Macquarie Islands in December,
1947, and February, 1948, be maintained in accordance with original
plans. The Minister for External Affairs ( Dr. Evatt) indicated that
the development of a full programme ( including the establishment and
maintenance of a permanent base on the A-ntarctic Continent itself)
would involve the acquisition of a new ship in addition to the vessel
Wyatt . Earp at present being used.
Reviewing the finances of the expedition, Cabinet approved of
an expenditure of œ 327,000 for the current financial year's activities.
This includes the establishment of fixed instalments at Heard and Macquarie
Islands and considerable supplies of technical equipment for
the parties there also for the scientific activities carried out by the
Wyatt Earp. A sum of œ 200,000 h. as been set aside for operations in
1948-49. Cabinet agreed that further consideration should * be given to the
exploitation of sea elephants on Heard and Macquarie Islands if this
should be proved commercially profitable.
" An inter-departmental committee consisting of representatives of
the Departments of the Treasury, Public Service Board, External
Affairs, External Territories, Commerce, and Council for Scientific and
Industrial Research will he set up to make recommendations regarding
future administrative arrangements for Australia's antarctic work."
AUSTRALIAN EXPEDITION-ADM IN ISTRATITON.
On 4th May, 1948, Mr. Chifley said-
Cabinet to-day adopted the recommendations of an inter-departmental
committee set up to consider an appropriate organization for
the future administration of the Antarctic Expedition. This will be

done by the organization of an Antarctic section within the. Department
of External Affairs which will be temporarily located at Melbourne.
In addition, a committee will be established as an advisory
body to the Department and the Antarctic section on matters connected
with exploration, scientific research, development and the like of the
Antarctic Territory. This committee will replace the existing advisory
commnittee. The facilities of the Council for Scientific and Industrial
Research will be used as much as possible in the planning of scientific
research in the Territory and in the collation and distribution of the
resulting information." RECONSTRUCTION.
WORLD ORGANIZATION-UNITED NATIONS DAY.
On 5th April, 1948, the Prime Minister ( Mr. Chifley) said-
Cabinet decided to-day that 24th October be officially proclaimed
United Nations Day'I and appropriate celebrations over the radio and
in the schools -be arranged with the assistance of the Australian National
Committee of the United Nations. The United Nations' flag will be
flown on all Commonwealth buildings and State governments will be
asked to do likewise."
WORLD ORGANIZATION-FREEDOM OF INFORMATION.
On 18th April, 1948, the Minister for External Affairs ( Dr. Evatt)
said-The United Nations Conference on Freedom of Information has
reached important conclusions. It recommends to all countries positive
measures to spread factual information on international affairs and
it condemns all propaganda designed or likely to provoke or encourage
any threat to the peace. Unanimity between the eastern and western
nations of Europe was obtained and this is, in itself, one step forward
in the positive effort to prevent World War III.
The part played by Australia has been notable. Our delegation's
imitiative has been widely and favorably commented on. Australia
succeeded in securing the acceptance of one of the main resolutions.
The chairman of the conference paid a special tribute to Auitralia,
rebuffing the defeatist attitude of a tiny section of Australians who, in
spite of the bitter lessons of the Pacific war, are opposed to the active
participation of their country in international affairs.
One of the greatest contributions to peace which can be made is
to discourage propaganda and distorted reporting, which represents
a real danger in times of international tension. The best way of
preventing war-mongering propaganda is not any form of censorship,
but fair and accurate reporting of the facts. The most effective way
to handle war-mongers is not ' by suppression, but by free reporting.
" This Geneva success, following the General Assembly resolution,
demonstrates that middle Powers like Australia can play a major
role in composing differences between the great Powers, and in helping
to ' prevent the world from crystallizing into rigid and opposing blocs.

14
" It is not enough to criticize war-mongering. Friendly relations
between countries must be encouraged. Positive means of co-operation
and assistance will soon arrest any ' drift towards war."
THE GOVERNMENT.
MINISTERIAL DUTIES.
On 6th April, 1948, the Prime Minister ( Mr. Chifley) said-
" The Minister for Supply and Shipping ( Senator Ashley) has
to-day been sworn in as Minister for Shipping and Fuel.
" The Minister for Munitions ( Senator Armstrong) has to-day
been sworn in as Minister for Supply and Development.
Some minor administrative changes have been made and the duties
of the respective Ministers will be:
Senator Ashley: Stevedoring labour and operations; coal production
and distribution; liquid fuels and petroleum products
and related matters.
Senator Armstrong: Procurement of supplies; manufacture of
munitions; mineral resources; disposals; shipbuilding.
" Control of jute and flax will now be vested in the Minister for
Commerce and Agriculture ( Mr. Pollard).
" Mr. J. K. Jensen will be Secretary of the Department of Supply
and Development and Mr. F. A. O'Connor will be first Assistant Secretary
of the department.
Mr. G. G. Sutcliffe wvill be Secretary of the Department of Shipping
and Fuel." N-O-CONFIDENCE MOTION, APRIL, 1948.
In Parliament.-On 7th April, 1948, the Leader of the Opposition
( Mr. Menzies) moved the following motion:
That in the opinion of this House
Communist activities in Australia are subversive.
( b Communists in Australia have fomented widespread stoppages of
employment, sought to weaken the authority of the industrial law,
and inflicted misery and loss upon thousands of citizens.
There is good reason to believe that Australian Communists act in
the interests of a foreign power.
Recent events in Europe have p roved that Conmmunist minorities in
counitries outside the Soviet Union are organized so as to overthrow
hy force majority rule in those countries.
The Governnient has failed to take any adequate steps to attack
Communist activities in Australia, or to prevent the employment
of Communists by the Commonwealth.
And that by reason of the above the Government deserves the censure of this
House. Mr. Chifley said-
Mr. Menzies has made what purports to be a denunciation of a
great social evil in this community, but, in a speech of more than
minutes' duration, he did not make one suggestion as to how that evil
should be cured. The press has done him a grave injustice. The press,
for some weeks now, has carried announcements that at last he has

been weaned or forced--I presume forced-from his previous views
in regard to communism. One would, accordingly, have expected him
to-day to have taken the high jump at the suggestion of the Australian
Country party, and plump for the banning of the Communist party;
but he did not do so. In a speech lasting for more than 40 minutes
he did not say one word about banning communism, nor did he make
one single suggestion as to how Communists should be dealt with.
" Unfortunately, a flood of communism has swept Europe. Communism
is rife not only in countries that are under Communist domination
but also in the countries that are still democratic. That is the fruit of
hundreds and hundreds of years in which 80 per cent. of the people
lived in the direst poverty. That is why the world has to suffer
communism to-day. The soil in which communism has flourished was
fertilized by people without any idea of democracy. From one extreme
the people have swung to the other. In most countries there are
Communist elements. Twenty-five years ago the Communists were
supposed to be confined to common people, manual labourers and people
of that character, but to-day communism has become something in the
nature of a religion and has drawn into its ranks many intellectuals.
They are classed as Communists, fellow travellers, and crypto-
Communists by those who see in the movement, as I do, the grave
menace to democracy that communism presents. But the evil will not
be cured or the blight on the world removed by the sort of loose talk
that goes on in Australia and other countries. I cast my mind back
to five years ago, when, as Treasurer, I said to the then Prime Minister,
the late Mr. John Curtin-
War or no war, I believe that every government has to stand up to the task
of ensuring social security to the people, because, if it does not, I fear that,
with the end of the war, the great mass of the people will be gravely dissatisfied
and wonder what the war was fought for if they are left with only poverty and
misery and no security.
" With the help and advice of my colleagues in the Australian
Labour movement, I launched the system of social security that we
enjoy to-day. In the previous 40 years, when for most of the time,
the anti-Labour parties were in power-the Labour party had few
years in office-not one piece of social legislation was passed by the
Australian Parliament. I mention that because the only way in which
to defeat communism is for the democracies of the world to be readily
democratic. " Much has been said about the suppression of minorities. According
to press reports, Mr. Menzies made some rather scathing comments
about my statement that the Australian Labour party would not lend
itself to the banning of a political party, because it held a certain
political philosophy. The Australian Labour party is entirely opposed
to the principles of communism, including its economic theories for
the management of a country, and its attitude towards religion. I
speak for the Government as well as for myself when I say that we
completely abhor the principles of communism for the attainment
of the party's objectives. However, I shall never support any policy

I; 16
which is designed to deprive minorities of the right of expression
unless-I qualify that statement-those expressions are subversive,
seditious or in some way detrimental to the safety of the country.
" I remind opposition members that not one English-speaking
country, with the exception of Canada and Australia in war-time,
has placed a ban on the activities, political or otherwise, of the
Communists.
J " I propose to place on record the statement of the Prime Minister
of Britain ( Mr. Attlee) from the Hansard report of the House of
Commons, dated 15th March, 1948-
1 desire to mnake a statement in regard to certain matters of employment in
the Civil Service.
In answers to questions on the subject of the transfer or dismissal of certain
Government servants, I have said that there are 4certain duties of such secrecy
that the State is not justified in employing in connexion with them any one
whose reliability is in doubt.
Experience, both in this country and elsewhere, has shown that membership
of, and other forms of continuing association with, the Communist party nmkay
involve the acceptance of the individual of a loyalty, which in certain circumstances
can he inimical to the State.
It is not suggested that in matters affecting the security of the State, all
those who adhiere to the Communist party would oallow themselves thus to forget
their primary loyalty to the State. But there is no way of distinguishing such
people from those wvho, if opportunity offered, would he prepared to endanger
the security of the State in the interests of another Power. The Government
has, therefore, reached the conclusion that the only prudent course to adopt is
to ensure that no one who is known to be a member of the Communist party, Or
to be associated with it in such a way as to raise legitimate doubts about his or
her reliability, is employed in connexion with work, the natuie of which is vital
to the security of the State.
Thie same rutle will govern the einploynient of those who are known to be
actively associated with fascist organizations.
I should emphasize that this actioii is being takeii solely on security grounds.
The State is not concerned with the political views, as such, of its servants,
and as far as possible alternative employment on the wide range of non-secret
government work will be found for those who are deemed for the reason indicated
to he unsuitable for secret work. It may, however, happen that it is impossible
to find suitable employment elsewhere in the Civil Service for individuals with
specialist qualifications.
And in such cases there may he no0 alternative to refusal of employment or
dismissal. I do not propose to read all the questions which members of the
House of Commons directed to the Prime Minister in the course of this
statement, but I do desire to read a question by Sir Ian Fraser, whose
loyalty nobody doubts. Sir Ian asked-
In applying the restriction in the Government service, and as far as it affects
the British Broadcasting Corporation and the country generally, will the right
honorable gentlem~ an advise that it shall he kept within the very narrow limits
related strictly to security. Otherwise, does he not think that it is an unaccusturned
and difficult course on which lie may he embarking?
I invite Opposition members to listen carefully to Mr. Attlee's
reply-I think I made it abundantly clear in my statememit that this wvas restricted
to very narrow limits where security matters were of importance.
I have been asked to explain what action the Government is taking
against the Communists. The Government has not waited for this
clamour and for what I may describe as this wave of hysteria which is

17
sweeping through the world and which could lead to the grave consequences
of war, when a little cool-headedness may avoid it. The Government
has always considered that, in mat ' ters involving security, all
persons entering the Public Service should he checked; and all members
of the Public Service, even though they may not have been engaged in
security work, have been subject to close scrutiny. I give to the country
a complete assurance that so far as the Commonwealth Investigation
Service and the State police forces can detect, no person whom Mr.
Attlee's description fits, is engaged in vital security work. The Government
did not wait for the present clamour, which has been raised in
the press, or any other agitation before taking steps to safeguard the
country. " The Australian Labour party is completely opposed to the principles
of communism. Let us he quite honest about this matter and
admit that within the ranks of every political party there are people
out on the wings who are extremely radical in their views. That,
incidentally, is the only reason why there is a Labour party to-day.
There would never have been a Labour party if there had not been in
the community radicals-democratic radicals-who loved their country
and fought for what they believed to be in the interests of the majority
of the people. The men who formed the Australian Labour party had
to contend with the bitterest opposition, with talk of socialism and
the red tiger' 1, and it was even alleged by their opponents that they
advocated the breaking of the marriage tie. However, in the face of
all that opposition they triumphed, and the history of the Parliament,
and particularly that of the last six years, proves that. When this
country was confronted by the gravest peril in its history-and I ask
members of the Opposition to turn this one over in their minds-the
people of Australia entrusted the administration of the country's
affairs, not to a conservative party, but to the Australian Labour party,
which represented the people. If any political party was ever condemned
at the throne of judgment in its country's hour of trial it was
the conservative parties opposite. Tens of thousands of people who had
never voted for a Labour candidate in their lives voted Labour. They
said, in effect, ' In a great crisis these are the only people who can do the
job effectively ', and the people of Australia virtually expressed the
same opinion when they voted at the last general elections.
Members of the political party to which I belong have as much
love for this country and the safety of its people as the members of
any other political party. Opposition members should not think that
they possess a monopoly of love of country. Members, of the Australian
Labour party have always been independent in their regard for the
welfare of the people. We have consistently advocated changes designed
to improve the lot of the mass of the people of this country, and I think
that that is proved by our political record.
" I do not intend to weary the House by reading the text of resolutions
adopted by the federal executive of the Australian Labour party,
but year after year that body has expressed, on behalf of the Labour

18
movement in Australia, its strongest opposition to the Communist
party. As I said previously, it is true that in every political party,
including the Australian Labour party, there are radicals and militants.
However, many of those people are perfectly honest and quite sincere
and have no association with Communists. Opposition members cannot
blame the Australian Labour party for tbat. Behind the Opposition
political parties are objectionable people, people whom Opposition
mlembers would disown and whomn Mr. Menzies would disown. In the
same way there are on the edge of the Australian Labour party men
wvho are quite sincere, but quite radical and militant, and the views
which they express can easily be misinterpreted as expressions of
disloyalty. I have seen a great deal inside the industrial and political Labour
movement, and I have read some history. I have never known of any
minority movement in history that has not grown stronger by repressive
aFction. Let me emphasize this never is liberty more easily lost than
when we think we are defending it. My recollection embraces the
history of quite a few minority movements. Some were religious, some
were political and others were national in aim. Strenuous efforts were
mnade to repress many of then], but in almost every case they grew
stronger by repression. I have said in this House before that the people
wvill not finially accept brutal, repressive action. We can only overcome
communism in one way. Comm unism. can only be beaten by improving
the conditions of the people bad conditions are the soil in which it
thrives. There is talk of gaining political advantage or positions in
Parliament, but to me liberty is far more important than that. I
should not be a member of this Parliament if some tolerance had been
extended to the men who took part in the strike of 1917. All that
harsh oppressive treatment did, as far as I was concerned, was to transform
me, with the assistance of my colleagues, from an ordinary
common engine-driver to the Prime Minister of this country. If an
example of what harshness can do is required, my presence in this
Parliament should be sufficient.
This Government will leave no stone unturned in its efforts to
encourage the trade unions to prevent their control by Communists.
The unions have got to do that themselves it is their task. From the
political and defence point of view, the Government will do everything
possible to provide that neither Communists nor fascists are associated
with the work of ensuring the security of Australia. We shall not
begin to chase shadows. If a ban is imposed on the Communist party,
it will merely change its name, as it did in Canada, and go on in
exactly the same way. We are going to fight Communism in the open.
If there are persons in this country who are seditious, treasonable or
subversive, there are laws by whichi they canl be dealt with, and this
Government wil] deal with them [ T'he motion was defeated.

I NDUSTRIAL.
UNEMPLOYMENT-FIGURES.
On 7th April, 1948, the Minister for Labour ( Mr. Holloway) said
that the demand for labour in Australia reached a new record high
level in February, 1948. Unfilled vacancies held by the Commonwealth
Employment Service numbered 58,300 for males and 36,800 for females,
the. total of 95,100 being nearly 3,000 greater than the previous record
high level. Unemployment, although practically negligible for months
in. all States, except Queensland, had fallen even further. Recipients. of
unemployment benefit ( including re-employment allowance) numbered
6,410 males and 209 females. During February, 1948, the Commonwealth
Employment Service had referred 27,200 males and, 8,100,
females to employers, and had given advice and information on. various
matters to 28,500 males and 6,400 females.
BRITISH COMMONWEALTH OF NATION&,
VISIT OF KING AND QUEEN TO AUSTRALIAPROGRAMME.
On 14th April, 1948, the Prime Minister ( Mr. Chifley) said-
Advice has been received from the Private Secretary to The Kingthat
Their Majesties The King and Queen and The-Princess Margaret
will leave New Zealand so as to reach Australia on 4th. April,, 1949,.
Their Majesties and. Her Royal Highness will leave Fremantle at the:
end of the visit on 13th June, 1949.
The Cabinet sub-committee, in consultation with representatives
of the Opposition parties, has considered the division of' the period
which Their Majesties and Her Royal Highness will spend in Australia.
The outline of the itinerary, submitted to His Majesty for his approval,
shows the proposed allocation of time in the Australia Capital Territory
and in the States. The State Government& have been requested
to. prepare a suggested programme for the Royal Tour, covering the
period in each State.
The proposed' itinerary and detailed programme throughout Australia
will, in due course, be presented to His Majesty for approval.?"
On 29th April, 1948, Mr. Chifley said-
The following appointments have been made to the Commonwealth
staff dealing with the visit of Their Majesties the King. and Queen and
The Princess Margaret to Australia in 1949:
The Reception Officer, Prime Minister's Department ( Mr. J. S.
Murray) to be Secretary of the Royal Visit.
Mr. 0. A. Rogue to be in charge of public relations, to be joined,,
as arrangements for, the Royal Tour progress, by the Prime
Minister's Press Secretary ( Mr. D. K. Rodgers)."

DEPARTMENT OF SUPPLY AND DEVELOPMENT.
REOONSTITUTION BILL INTRODUCED.
In Parliament.-On 14th April, 1948, the Prime Minister ( Mr.
Chifley) introduced the Supply and Development Bill. Mr. Chifley
said-In Britain, the services essential to the armed forces are provided
by the Ministry of . Supply, and in the ' United ' States by the Munitions
Board. The Australian Government has decided that there must be
a complementary body in the Commonwealth and has re-instituted the
Department of Supply and Development. Under an act of 1939, a
Department of Supply and Development was set up to be concerned with
the procurement and manufacture of supplies and munitions for the
armed services and to develop the resources of the Commonwealth so
that we might be prepared in the event of war. On the outbreak of war
the department was concerned with the procurement of war supplies and
with the production of munitions and aircraft, but a separate Ministry
of Munitions was set up in 1940, and, in 1941, a further Ministry of
Aircraft Production was established. Meanwhile the Department of
Supply was merged in a Department of Supply and Shipping.
With the end of the war, the departments took up an active policy
of reconversion to peace-time conditions in industry and a stage has
now been reached at which they can merge again in a combined Department
of , Supply and Development with functions similar to those which
obtained before the war. The principal change to be made in the act
is the substitution of the expression war materiel for munitions'
wherever the latter occurs. The expression has a much wider meaning
than munitions and is so used in the British and United States
forces. It may be defined as including everything used in war except
the personnel. The intention of the amendment is that the responsibility
for provision of the needs of warfare, except man-power, shall be
placed upon the new department.
The general organization of the department contemplates that
there shall be boards responsible for the management and administration
of the following four main groups of undertakings:-
Munitions production, including arms and ammunition factories; aircraft
production factories; long-range weapons research and experimental establishment;
ship construction and repairs.
There will be branches concerned with procurement of supplies
from industry for the services, including a Contract Board, mineral
resources development, including geophysical and geological surveys,
stores and transport services for the Commonwealth departments, and
scientific research and technical advice for defence purposes and for
assistance to industry generally.
Provision is made in the act to ensure the safety of the public in
connexion with the operations of the long-range weapons range and to
acknowledge the possibility of compensation should accidents unfortunately
happen. Provision is made for secrecy on the part of persons

employed on the operations, and for the steps neccessary to prevent
enitry of unauthorized persons on secret defence undertakings and for
search of suspected persons in such areas, particularly in respect of
dangerous inflammable materials or explosive substances.
" The bill provides for continuity of service in regard to the technical
staff and employees transferred from other departments during
the war or engaged specially under regulations of the National Security
Act, so that such rights and privileges as they may have acquired as
a result of their service under the ! Commonwealth may be continued.
Opportunity is being taken to amend the act so that those salaried
employees formerly exempt from the operation of the Public Service
Act will be transferred to the Commonwealth Public Service and be
governed by the Public Service Act." [ The bill was passed.
PRIMARY INDUSTRIES.
RABBIT SKINS-EXPORT LEVY.
On 15th April, 1948, the Minister for rCommerce ( Mr. Pollard)
announced that the exemption of rabbit skins shipments from export
levy would be continued until 31st May, 1948. The exemption was
due to expire on 30th April, 1948.
EXPORTS TO BRITAIN-1947 FIGURES.
In Parliament.-On 26th April, 1948, Mr. Pollard said that Australian
exports to Britain for the calendar year 1947 were-
Commrodity. Quantity. Value.
lb. LA.
MEAT PRESERVED
Beef, chiled
Beef, frozen
Veal Lamb
Mutton Pork BY COLD PROCESS. 7,168
202,393,533 1,521,986
106,212,9U4 15,938,774 3,940,642
MEAT NOT PRESERVED BY COLD PROCESS.
Bacon and hams 1 530,675
MEAT iN TINS OR OTHER AmRTIOHT VESSELS.
Beef and veal 30,700,858
Mutton 1 ,926,709
Bacon 3,777,305
Sheep's tongues 506,526
Sausages 5,220,715
Meat and Vegetables 13,397,076
Other ( including soup) 10,743,741 672
5,110,471 45,815
3,820,861 274,287 195,349 50,632
1,782,245 127,184
390,445 46,968
391,071 608,173 581,498

ft 22
Commodity. Quantity. Value.
lb. LA.
DAIRY PRODUCE.
Milk-Preserved, Concentra~ ted and Frozen.
Full Cream . I 2,413,570 74,001
Unsweetened I 2,776,655 88,962
Milk-Dried or Powdered.
Full Cream 2,332,834 87,204
Skim 2,615,692 73,710
Butter 135,002,016 12,104,048
Cheese 40,298,712 1,924,913
Eggs. dozen.
Eggs in shell 12,786,058 1,323,950
lb.
Liquid eggs 19,975,092 1,536,187
cental.
Wheat 988,133 1,399,894
Flour 1,998,377 3,386,832
( ror earlier references, please see No. 124, page
PRICES.
GOODS " DECLARED "-LAMB, REVOCATION.
On 16th April, 1948, the Minister for Customs ( Senator Courtice)
announced that lamb would be removed from price control from 19th
April, 1948. The good season with the prospect of another wool clip
at a high price had encouraged graziers to hold stock, with the result
that a shortage of lamb could be expected during the coming winter.
Although there would be no general shortage of meat the shortage of
lamb created conditions favorable to the blackmarketer against
whose competition reputable traders could not carry on except at a
heavy loss. NEW ZEALAND.
VISIT OF NEW ZEALAND GOVERNOR-GENERAL.
On 19th April, 1948, the Prime Minister ( Mr. Chifley) said-
His Excellency the Governor-General ( Mr. McKell), on behalf
of the Commonwealth Government, extended an invitation to the
Governor-General of New Zealand ( Lieutenant-General Sir Bernard
Freyberg) and Lady Freyberg to pay a visit to Australia. Their
Excellencies have accepted the invitation and propose to arrive in
Auztralia some time in November, 1948."

DEFENCE.
COUNCIL OF DEFENCE-MEETING.
On 20th April, 1948, the Prime Minister ( Mr. Chifley) said-
At the meeting of the Council of Defence to-day, the normal
review of the basis of Australian post-war defence policy was made
before the council proceeded to the detailed discussion of other subjects.
Among the items dealt with were the foll-owing:
Consideration was given to matters relating to the scientific
aspect of defence policy arising from the conclusions and recommendations
of the 1947 meeting at London of the British Commonwealth
Advisory Committee on Defence Science and from the first
report of the Defence Scientific Advisory Committee.
The progress of the joint United Kingdom-Australian long range
weapons project was considered.
Decisions were taken on the organization for the executive of
defence research and development.
" Another meeting of the council will be held next week at which
the progress of the defence programme will be reviewed, following
which a statement will be made by the Minister for Defence ( Mr.
Dedman) in Parliament." TRADE MARKS.
PROPOSED LEGISLATION.
On 20th April, 1948, the Prime Minister ( Mr. Chifley) said-
The Attorney-General ( Dr. Evatt) reported to Cabinet to-day
that a licence by a proprietor of a trade mark to another to use the
trade mark on goods other than those of the proprietor of the trade
mark is a form of deception which invalidates the registration of the
mark. This rule applies when the proprietor of a mark owns and
controls the other party to whom the licence is given. Consequently,
a parent company cannot license a subsidiary company. In Britain,
legislation has been passed whereby a person, other than a proprietor
of a trade mark may be registered as a registered user of the mark.
Conditions of registration are laid down and provision is made against
I trafficking." Cabinet decided to-day that the Trade Marks Act should be amended
along the lines of the British Act to provide for permitted users of
trade marks and assignment of trade marks without assignment of
goodwill. It has been pointed out that many Australian companies
have subsidiary companies operating in different States, and if any of
these separate legal entities uses the registered trade mark of the
parent company the registration of the mark is invalidated. Further,
many overseas manufacturers desire to make arrangements with Australian
companies for the local manufacture of goods formierly manufactured
overseas and sold under well-known trade marks. The
proposed amendment of the act will help in the industrial development
of Australia and the establishment of new industries."

24
INTERNATIONAL WHEAT AGREEMENT.
BILL INTRODUCED.
In Parliament On 22nd April, 1948, the Minister for Agriculture
( Mr. Pollard) introduced the International Wheat Agreement Bill.
Mr. Pollard said-
The object of this bill is to ratify the international wheat agreement
drawn up in Washington in March, 1948, by the representatives
of the governments of 36 countries. The agreement is subject to
ratification, or formal acceptance, by the governments concerned by
1st July, 1948.
" At the outbreak of war in September, 1939, the f. o. b. Australian
export price of wheat was around 2s. Australian currency a bushel.
Some transactions took place at about is. 10d. a bushel at this time.
Two years previously the average f. o. b. price was around 5s., Australian
currency. For some years into the war, accumulated supplies and
harvests were such that prices rose very slowly. At the end of 1943
the Australian Wheat Board's export price was 4s. lid. bulk,
for sales west of Suez and 4s. 7td. for sales east of Suez. At the close
of the recent war there was a world-wide food shortage. There was
a delay in getting European wheat countries back into production.
Prices obtainable by exporters rose to record heights until in November,
1947, the price on the Chicago market for the shortest term futures
rose to 3 dollars 20 cents, the export equivalent for shipments from
Gulf of Mexico ports being 3 dollars 30 cents, or 20s. 9d. Australian.
At this time and for some weeks afterwards Australia was obtaining
19s. 6d. a bushel for its wheat. Later, the Australian Wheat Board
increased its price to 20s. 6d. a bushel.
It is difficult to say precisely what world prices are, and it is clear
that there is no world price in the pre-war sense. In normal times,
wheat was traded freely at exchanges in Winnipeg, Liverpool, the
Baltic, in London, and at Chicago and Minneapolis. Now Liverpool
and Winnipeg are closed, and Chicago and Minneapolis deal largely
with the huge American domestic consumption-a figure exceeding the
Canadian and Australian production put together. At the end of
January, 1948, when negotiations for the agreement opened, Canada
had a contract, entered into in 1946, to sell a substantial proportion of
its exportable surplus to Britain up to the end of July, 1950. The
price for deliveries during the year, 1st August, 19-17, to 31st July,
1948, was fixed at 1.55 dollars or 9s. 8d. Australian a bushel in store
Fort William/ Port Arthur. For deliveries during 1948-49, the price
is to be 2 dollars or 12s. 5d. Australian a bushel. In January, Canada
was selling to other countries at prices around 3.25 dollars-about
œ 1 Australian-a bushel, which were comparable with the United States
export price. Australia had negotiated contracts with Britain and
India for the sale of 105,000,000 bushels, at prices of 17s., equivalent
to about 2.7 dollars a bushel, in the case of Britain and of 18s. 6d.,
equivalent to about 3 dollars a bushel, in the case of India. The

' Wheat Board's export price at the end of January was 20s. 6d. a bushel.
The Argentine was selling at about 5 dollars or over 30s. a bushel.
With all these varying prices, and with so little wheat being sold
on a freemarket, it is clearly unsound to refer to a ' world price
" A world price of course means competition between suppliers.
Now no competition exists. Where there is competition it must be
expressed in comparable * prices in the buying markets, whether these
prices are brought back to f. o. b. for quotation or left c. i. f. Where a
supplying country, Australia is an example, has one f. o. b. quote for all
countries it is evident that there is no world price, since it means that
each country is paying a different landed price for Australian wheat
because of the difference in cost of freight. The Chicago market has
been assumed by some to give world prices, but it is clear that this is
not so when Argentina can obtain prices much higher than the export
equivalent of the Chicago price. However, it can be said on the following
reasoning that Chicago prices give a good indication of the trend of
the market. Chicago prices, in the mnain, over a period are influenced
by the quantity of wheat the United States Government takes off the
domestic market. If a slackening in demand on American export wheat
reduces pressure on Chicago, prices fall there and American wheat for
export falls correspondingly. As soon as there is sufficient whea~ t
coming from other countries to cause an exporter to offer wheat in the
same market as America, competition will arise. A world price will
then he quotable, and in the different supplying countries quotes will
be based on competitive landed prices in importing countries.
" Following an exchange of views between their govern-ments,
officials of Argentina, Australia, Canada, the United States and
Britain met in Washington in July, 1941. A preliminary report was
submitted in August, 1941, in which the principles of acreage control,
price ranges and export quotas were again put forward. The Governmnents
agreed that their representatives should meet again to work over
the details of the proposed agreement. The conference was resumed in
October, 1941, and met at various dates up to April, 1942, when a
memorandum of agreement, to which was attached a draft convention,
was drawn up and accepted by the Governments of Australia, Argentina,
Canada, the United States and Britain. This memorandum indicated
agreement among the four principal exporters on quotas. On the basis
ef aggregate exports of 500,000,000 bushels, the percentages were,
Canada 40 px_ nt., Argentina 25 per cent., Australia 19 per cent.,
and United States 16 per cent.
From 1943 to 1946, frequent attempts were made to reach an
agreemient on price ranges for incorporation in an agreement for the
stabilization of trade during the war and early post-war years. The
stumbling block was a'lways the price ranges, Britain being unable to
mneet the views of the exporters. By 1943, the Australian Wheat Board
was in existence. It was constantly consulted by the department on
details.

' I 26
" At the conference in London in March, 1947, it was made clear
that Argentina would not be a participant, and a new approach was
attempted, the new feature introduced -being guarantees by individual
importers to take specified-quantities. Though agreement was not
reacahed on all details, the principles stated in 1947 were used as the
basis of negotiations at the recent conference in Washington at which
full agreement was reached.
" The quantity of wheat covered by the agreement is 500,000,000
bushels, of which. Australia's share is 85,000,000. Australia is bound to
supply this quantity if it possibly can. If it cannot provide 85,000,0%,
bushels, the United States anid Canada wvill be first asked to make up the
discrepancy. If they cannot do so, then Australia is released from: its
obligations, provided that its failure is due to crop losses and is not due,
for example, to having made large sales outside the agreement. If
Australia has more than 85,000,000 bushels to sell, it may sell-additional
wheat outside the agreement, either to countries not in the agreement,
or by making increased sales to countries within the agreement. From
conversations not yet on a formal -basis, it is apparent that Britain
together with the colonies for which Britain has assumed responsibility
in thc agreement, will require more than the quantity provided for it in
the agreement-180,000,000 bushels. Some of this extra quantity will
certainly be drawn from Australia outside the agreement.
The 85,000,000 bushels is considered to be adequate. In fact, it
was not considered that Australia would be justified, under the terms: of
the agreement, in seeking a higher -figure. It is estimated that. this will
require an average harvest over the five years of about 170,000,000
bushels, and that an average of .180,000,000 bushels would not be an
embarrassment. In the first year of the agreement it is certain that
we will be able to sell all our excess over the 85,000,000, and it is
almost certain that we shall do so in the second year-August, 1949, to
July, 1950-and that we shall enter into the third year of the agreement
with a low carry-over. Even with heavy harvests, therefore, some
increase of carry-over in the later years of the agreement could be
accepted without difficulty.
" No provision is made in the agreement for restriction of production,
but if supplying countries produced more than their quota, and
other quantities they could sell outside the agreement, they might be
forced to limit output. However, it should not be necessary for Australia
to contemplate restriction of production during the course of the
agreement. " In selecting a price range many bases were considered,' but rather
early in the negotiations-in 1941-42, in fact-Canadian sales were
adopted as a basis, with equivalents to be worked out for Australian
and United States sales. Although this basis was reviewed at different
times, it was ultimately adopted. The views of Australia in regard to
the treatment of sales to ' nearly markets were accepted and given
effect in the formula set out ini the agreement. This formula means, in

A. i? 27
effect, that in. sales for delivery to Britain when prices are at the top of
Sthe range, Australia will charge the same c. i. f. as Canada, subject to
any agreement for a difference on account of quality between Canadian
and Australian wheat. As freight between Australia and Britain is
greater than that between Canada and Britain, on the same c. i. f. price
Australia would get a lower f. o. b. return than Canada.. On present
freights, Canada would receive the maximum of 2 dollars or 12s.
Australian, and Australia would receive 12s. The same price would
apply to such European countries as Holland, Belgium and France.
We might call this category A.
" In the case of India, and the British purchases for delivery to
Ceylon and Malaya, the Canadian c. i. f. price would be much higher
than the Australian consequently, when the Canadian f. o. b.
equivalent was the basic price of 2 dollars ( 12s. the Australian
f. o. b. equivalent would be much higher-perhaps 14s. 5d. In this case,
under the agreed formula, Australia will charge 12s. 5d., the basic f. o. b.
maximum. Canada cannot compete in these ' nearby markets' because
its c. i. f. quote would be much higher than the c. i. f. equivalent of
Australia's 12s, 5d. Thus, in; sales to these countries Australia's maximum
f. o. b. price will be a straight conversion from the Canadian fLo. b.
to the same figure in Australian currency. This group of countries
might be called category B.
It follows that, over the whole of our exports, the return Australia
will get on exports under the agreement will depend on the proportion of
category A to category B. A fair estimate is one -third A and two-third
B. On present freight charges and rates of exchange, this would give
12s. 3d. as an equivalent of the 2 dollars. If a quality differential of,
say, 6d. were agreed to in the case of sales to Britain-there will -be no
quality differential for sales to nearby countries-the average would be
about 12s. In the case of the minimum, much the same principles will
apply, although in certain circumstances the Australian f. o. b. price
for sales to ' nearby markets' would come down to the minimum f. o. b.
price for sales to Britain.
" In the case of markets equidistant from Canada and Australia-
Shanghai for example, when Canada is shipping out of Vancouver-it
would be necessary for us to be able t& come down to such a price in
order to compete with Canada on a c. i. f. basis in those markets. However,
where countries such as India, New Zealand, Java, Ceylon and
Malaya want wheat, or flour, they will naturally come to Australia for
it and pay the Canadian f. o. b. prices-converted, of course, to Australian
currency. Here, again, the actual minimum return overall
would depend on the proportions of the 85,000,000 bushels that go to the
different destinations. A fair estimate would be that, if prices fel
heavily and reached the minimum of 1 dollar 20 cents throughout the
fourth year, the average return would be about 7s., and that, if they
went to the minimum of I dollar 10 cents in the fifth year, the average
return would be about 6s. 4d. The calculations which have been used in
arriving at these figures are conservative. ' I
9!

28
" Alterations of freight rates would affect sales in category A. If'
freights fell, our f. o. b. return would increase. If they rose, the reverse
would be the case. Alterations in exchange would also affect these
equivalents if such alterations affected the relationship between Australian
currency and the Canadian dollar. A special clause in the
agreement provides that, if the Canadian dollar depreciates on the
American dollar, there will be no change in the basic prices.
" There is no commitment under the agreement that wheat shall -bepreferred
to flour. In practice, Australian mills should be able to sell
their full output. The British allotment under the agreement covers
flour for Britain, Ceylon, Malaya and British commitments in respect
of other colonies. The Netherlands quota inceludes flour for the Netherlands
East Indies. These, with the requirements of the Pacific Islands,
should keep our mills going.
" It is true, of course, that in the first year Australian growers will
make a monetary sacrifice; they will receive less under the agreemient
than if there were no agreemeut. This position might obtain also in
the second year. It could even continue further. As time goes on,
however, the risks the grower takes with no assured minimum become.
greater. When the slump comes-and all close observers say it will
come sooner or later-the consumer will be the loser and the producer
will gain. But no one can say what the severity or duration of the
slump will be. Summed up, the agreement seems to strike a fair balance
between the early contributions of the producer and the later contributions
of the consumer. However, with heavy crops in all wheat
countries, it could be a real boon to the producer. To my mind, its real
service to the Australian wheat-grower is that it gives him security.
While enjoying good returns, he may look forward for five years-I
personally hope the agreement will be reniewed long before the expiration
of five years-with onlfidence-confidence that he will not have to
face disastrous price falls such as the wheat-growers of Australia have
experienced in past years." [ The bill wuas passed.
( ror earlier reference, please see No. 134, page
ROYAL AUSTRALIAN NAVY.
AIRCRAFT CARRIERS.
In Parliament.-On 26th April, 1948, the Minister for the Navy
( Mr. Riord an) said-
The overall plan announced by the Minister for Defence ( Mr.
Dedman) on 4th June, 1947, envisaged the purchase by Australia of
two aircraft carriers. The first of these ships will be commissioned in
October, 1948, and will arrive in Australia early in 1949. The captain
and some of the senior officers have already left Australia for England,
where they arc doing certain courses. The remainder of the crew of
600 will leave Australia in May, 1948, on Kanimbla, and will undergo
certain training before the ship is commissioned.

29
The Government still intends to Purchase the second aircraft car-
7-ier, which should be commissioned towards the end of 1949 or in 1950.
The reason why I cannot give any definite date at the moment is that
-the Australian Government is endeavouring to have these aircraft carriers
so constructed that they will be modern at the moment when they
are commissioned. That is one of the reasons why the first aircraft
carrier will not be commissioned on 24th June, 1948, as was first
thought possible. I am not able to give the date or even the month
when the second aircraft cardier will be commissioned, because modern
improvements are being effected while the ship is being constructed.
As to whether the armament will be obsolete, it was only recently
that an order was placed for the purchase of aircraft. The reason for
the delay was that the Australian Government wanted to be certain that
these ships would be equipped with the most efficient and up-to-date
aircraft available for service on a carrier. Jet-propelled aircraft may
be issued to the American navy some time this year. We are now
examining whether it is possible, even by a delay of a few months, to
secure jet-propelled aircraft for the two ships."
( ror earlier references, please see No. 127, page 13.)
ROYAL AUSTRALIAN AIR FORCE.
RESERVE.
On 27th April, 1948, the Minister for Air ( Mr. Drakeford)
. announccd conditions of the Royal Australian Air Force Reserve as
follows: PERMANENT AIR FORCE RESERVE ( OR ACTIVE RESERVE).
To conmprise personnel immediately available for mobilization in an emergency
to bring existing unite to war strength * and to man additional units
required on the outbreak of war.
To be established, in the first instance, from personnel who have served dur-
Ing World War 11. and able and willing to undertake such annual or periodic
training as the Royal Australian Air Force might, from time to time, require.
In the initial stages, training to be confined to alectures, films, and distribution
of training pamphlets to be made available at centres. Subsequently, the reserve
to be maintained primarily from personnel completing engagements in the permanent
and citizen forces.
Conditions of service to be engagement for five years and further re-engagements
each of five years; applicants to volunteer for service andi be accepted
for enlistment in the reserve, to possess honorable discharges; to be medically
fit; and to report annually, notifying addresses or change of addresses, and
other particulars required.
Personnel appointed to the reservc to be appointed in the temporary rank
previously held.
Retirement from the reserve to be governed by the same retiring ages as
applicable to the permanent air force. 0
CITIZEN AIR FORCE RESERVE.
To consist of personnel possessing qualifications required for service in the
various branches of a modern air force.
To be constituted initially from trained personnel, including the Royal Australian
Air Force Nursing Service and the Women's Auxiliary Australian Air
Force who served. during World War II.
To be maintained partly fromi personnel trained in the active citizen air
force, and partly from persons in civil life possessing qualifications required
by the service.

Personnel not to be obliged to undertake any form of annual training butto
be required to give an undertaking that, in the event of a national emergency,
their services to be readily available to the Royal Australian Air Force..
Conditions Of service to be: Volunteers with previous service to be entered
It in their last substantive or higaher temporary rank; no time qualification in
I regard-to service, and personnel might withdraw on giving due notice; personnel
to be retired at the equivalent retiring ages for the p~ rmanent force;
persons desiring to enrol must undertake to report for duty when called on
in an emergency.
H AUSTRALIAN MILITARY FORCES.
DIRIECTOR-GENERAL OF MEDICAL SERVICES.
On 28th April, 1948, the Minister for the Army ( Mr. Chambers)
announced that Dr. F. K. Norris had been appointed Director-General
of Medical Services. MIGRATION.
GOVERNMENT POLICY-BRITISH MIGRANTS.
On 29th April, 1948, the Minister for Immigration ( Mr. Caiwell)
said-The ' open door' of Australia is no empty phrase when applied to
our kinsfolk from the British Isles. The Oovernment and the people
of Australia are determined to preserve the predominantly British
character of the Australian nation -by insisting that the highest possible
proportion of our population gain through immigration should be from
Britain. Australia's immigration figures for 1947 show that the number
of Britishers who came to Australia was twenty times as great as that
from the next highest source ( America), and three times as great as
that from all other world sources put together. Of 31,950 new arrivals
in 1947, Australia received 23,499 from Britain, 1,137 from the United
States, 843 from displaced persons camps in Europe, and 6,471 from
all other sources. This three to one overall ratio in favour of British
migrants will be maintained.
Would-be migrants in Britain may be assured that, wherever the
Australian Government has any influence in the allocation of berths on
ships ailing from Britain, no foreign national will be granted a passage
at the expense of a waiting Britisher. No ships that can be obtained
by the Australian Government will be allocated to the carriage of
non-British migrants while British migrants await transport."
RUSSIA.
EXCHANGE OF AMBASSADORS.
On 30th April, 1948, the Minister for External Affairs ( Dr. Evatt)
announced that the first Soviet Ambassador to Australia would be
Mr. N. M. ifanov and the first Australian Ambassador to Russia
would be Mr. A. Watt. The appointments wvere in accordance with

the recent mutual agreement between the Australian and Soviet Governments
to raise the status of their legations at Canberra and Moscow
to that of embassies.
Similar exchanges had been agreed to with France and China and
when those appointments were completed, Australia would be represented
on an ambassadorial level in the countries of all permanent
members of the United Nations Security Council.
BRITISH COMMONWEALTH OF NATIONS.
PROPOSED CONFERENCE.
In Parliament.-On 30th April, 1948, the Prime -Minister ( Mr.
Chifley) said-
No suggestion, either official or unofficial, has been made that a
conference of Empire Prime Ministers should be held. I realize, of
course, that on the economic side a very grave position has developed.
I realize how delicate is the position, and that it affects not only
Britain but ourselves and other countries with which Britain is associated.
It may be necessary for me or some other Minister conversant
with the economic aspects of the affairs of the Empire to visit London;
but no suggestion has yet * been received that such a visit should be
arranged.'' ( ror earlier reference, please see No. 134, page
SOCIAL SECURITY.
PHARMACEUTICAL SERVICE-MINISTER'S BROADCAST.
On 2nd May, 1948, the ' Minister for Health ( Senator Mc~ enna)
broadcast over the national network. Senator McKenna said-
" In 1947, the Government repealed acts of 1944 * and 1945, and
passed an entirely new act to enable pharmaceutical benefits to be
provided. Since then the Government has concluded discussions with
the Federal Council of the British Medical Association, the Federated
Pharmaceutical Service Guild, the Friendly Societies Dispensaries and
nearly all States.
Administrative arrangements bave been completed and regulations
under the act will come into force within the next few days. The
scheme will come into operation on 1st June, 1948.
The ' benefits are listed in the Commonwealth Pharmaceutical
formulary which will be published in book form. The Government
had at its disposal in the preparation of the formulary the best specialist
advice from the medical, pharmaceutical and pharmacological fields.
The benefits in-clude such modern drugs as those of the ' sulpha' group,
preparations of penicillin, vaccines, serums, anti-toxins and other
biological products such as insulin, The range of medication covered
by the. formulary includes preparations. nder more than 40 headings
ranging from ear, eye and nose drops to, children's requirements,

32
vit-amin solutions and sundry medical materials and applications..
Altogether, about 600 items are listed in formulary, but this gives
no idea of its scope since provision has been made for ingredients of
formulae to be omitted, reduced and in some cases increased. Provision
has been-made for certain drugs to be added to mixtures and.
other preparations. These provisions give great flexibility to the
formulary and permit of so many variations as to extend its range to.
hundreds of thousands of prescriptions.
" These benefits can be made available only on ' a prescription
written by a registered medical practitioner. The Government feels
that, having regard to the high standards of the medical profession,.
the risk of unnecessary prescribing is negligible. This arrangement
will provide a safeguard against unnecessary demands from patients,.
since they must consult their doctors as a preliminary to receipt of
pharmaceutical benefits.
There is no compulsion of any kind upon a doctor to co-operate
in the scheme. ' When a doctor does take part he is not bound in any
way to confine his prescribing to the formulary. If there should be
some particular drug or compound which he considers more appropriate
to, his patient's need than any contained in the formulary then he
will of course prescribe it, but in that case the patient himself must
pay for the prescription, the Government accepting full responsibility
for its omission from the formulary.
After a doctor has studied the contents of the formulary and its
flexibility I am sure that his decision regarding co-operation in the
scheme will be determined by his medical judgment, his humanity
and his good citzenship, and by no other consideration.
The act provides for the establishment of a formulary committee.
Its function will be to advise on the revision of the formuilary in the
light of experience, and of the latest developments in medical science.
The Government provided in the 1947 act, at the request of the Federal
Council of the British Medical Association, that the personnel of this
committee should be predominantly medical in character. This constitutes
one of the important points of difference between the original
scheme and the one now about to be launched.
" A second point of difference lies in the fact that whereas in the.
1944 scheme a penalty in the form of a fine, in default three months"
imprisonment, was imposed for doctors who prescribed unnecessarily,
this provision was wholly omitted from the 1947 act. This was done
at the request of the Federal Council of the British Medical Association.
The regulations embody a code specifying what constitutes proper
prescribing., This is based on a code submitted by the council. No
penalty or sanction whatsoever for -breach of the code has been provided.
The Government places its trust in the honour of the profession to
observe the code and has intimated to the council that should theconduct
of some few medical practitioners demonstrate the need for
something of that nature it wvill consult the council as to the form of'
sanction that would be appropriate.

33
" The patient's part in the scheme is very simple. Where his
-doctor prescribes a pharmaceutical benefit he will hand the prescriptionto
the patient in duplicate. The patient will then take the prescription
to any approved chemist or approved friendly society dispensary. He
will hand both copies -of the prescription to the pharmacist who will
supply the benefit without charge to the patient. ' Where the doctor has
ordered a prescription to be repeated, the patient will still hand both
copies of the prescription to the pharmacist who, in addition to supplying
the benefit will hand to him a repeat authorization form with the
duplicate of the prescription; these documents will enable him to
secure a repeat supply of the benefit from any -approved pharmacist.
" In chronic cases, for instance in the case of diabetics who are in
constant need of insulin, a doctor may, at one consultation, prescribe a
supply that will be adequate for up to 91 da~ a.
Special provision has also been made to meet the plight of persons
living in outback areas beyond the reach of the dispensing doctor or
chemist. " A doctor may prescribe a benefit without a Commonwealth form
in any case of emergency -but is required to supply the prescription
on -a proper form at a later date to enable the chemist supplying the
benefit to collect payment from the Commonwealth.
" Where a chemist is asked to d * ispense a prescription after usual
trading hours he is entitled to payement from the patient of a late
fee of is. In the case of a prescription endorsed by a doctor as urgent'I
the chemist is obliged to supply the benefit as soon as practicable
provided the prescription is presented at the premises of the approved
* chemist. Should it be necessary for the chemist to deliver any pharmaceutical
benefit he may make a charge equal to the actual cost of the
delivery. There is a prohibition against any doctor, chemist or hospital
dispenser parting with possession of or destroying any of the official
forms or publications issued to him except in accordance with the act.
As these documents are the basis of entitlement to receipt of and
payment for costly and dangerous drugs, this provision is essential for
the security of the community and for the proper protection of Commonwealth
funds.
All medicines needed by a patient occupying a public' bed in a
public ward are already provided for under the Commonwealth Hospital
Benefits Scheme and do not come within the ambit of the act.
Provision is being made by arrangement with the various States so
that out-patients will receive pharmaceutical benefits without cha rge
when the scheme comes into operation. Special arrangements will be
made to meet the needs of patients in private hospitals or in inter-
-mediate and private wards of public hospitals. These arrangements
will vary according to whether the hospital has or has not a pharmacist
on its premises."~

T 34
NETHERLANDS EAST INDIES.
PETROL.
On the 3rd Mlay, 1948, the Prime Minister ( Mr. Chifley) saidit
I have had discussions with representatives of the Vacuum Oil
Co. Pty. Ltd. and the Shell Co. of Australia Ltd. on the question of
increased production of petrol in the Netherlands East Indies which
will require arrangements for certain equipment. These arrangements
are going on satisfactorily.
AUSTRALIAN BROADCASTING COMMISSION
REVENUE FROM LICENCES.
On 4th May, 1948, the Prime Minister ( Mr. Chifley) said-
" Cabinet to-day decided that the Australian Broadcasting Commission
be authorized to spend, during the three months ending September
1948, an amount equivalent to an amount on the same basis as
during the current financial year plus such inescapable expenditure as
would enable the Commission to meet additional costs to which it is
, tready committed and other expenses of an essential nature.
" The Cabinet sub-committee appointed to consider conclusions
reached by a committee of which Mr. A. A. Fitzgerald was chairman on
a long-range plan for financing the commission has not yet completed
its deliberations." FIGHTING FORCES.
WAR SERVICE MORATORIUM-EXTENSION.
On 4th May, 1948, the Prime Minister ( Mr. Chifley) said-
" A discharged member of the forces remains a ' protected person'
for three years after being discharged or ceasing to -be engaged on war
service. The protection of female dependants and parents of discharged
members of the forces also exists for a similar period of three years.
The period was originally six months but was increased from time to
time so that it is now three years.. In many cases the three years'
period from discharge has recently expired or will expire in the near
future, and, unless the period is extended, there may be a considerable
number of evictions of ex-servicemen.
" The Re-establishment and Employment Act provides that land
owned by a member of the forces shall not be required compulsorily
without the prior consent of the Attorney-General. The Act provided
that the protection afforded should continue for a period of twelve
months after the date of discharge of the number or the period of the
length of the member's service whichever was the shorter period. As a
result of representations made last year by various organizations of
ex-servicemen, the period of twelve months was extended to two years,
so that ex-servi-cemen might not be deprived of land on which they
L_ 2

hoped to , build homes. In view of the present building difficulties, the
Direetor , of the Legal Service Bureau has expressed the opinion that it
is desirable to extend the period of protection . from two years to three
years. Representations have also been made by organizations of exservicemen
to the same effect.
Cabinet to-day decided that the period of protection under the
War Service Moratorium Regulations to discharged members of the
forces and -their dependants be extended from three years to four years;
and that the period of protection under the Re-establishment and
Employment Act to discharged members of the Forces be extended from
two years to four years." SERVICE -PAY RATES.
PERMANENT FORCES-RETIREMENT SCHEME, BILL
INTRODUCED.
In Parliament.--On 5th . May, 1948, the Minister for Defence :( Mr.
D. edman) introduced the Defence Forces Retirement Benefits Bill. Mr.
Dedman said-
The bill proposes to establish a scheme for improved retirement
benefits on a uniform basis for members of the Permanent Defence
Forces. The existing provisions for retirement benefits -are deficient.
In particular, they lack uniformity as between the three services. ' This
is no longer justifiable since comparable standards of pay and -service
conditions have been provided for all three services. Moreover, it
would be impossible under the existing retirement provision to deal
adequately with the peculiarly difficult problem created by the practice,
now common to all services, of retirement at comparatively early ages.
Early retirement of members of the forces has been made necessary by
the requirements of a modern defence system. It is now the rule in the
British armed forces and the other British Commonwealth countries.
In view of our special needs for defence forces of the highest efficiency
under conditions of present warfare, we cannot afford to lag behind in
this vital matter.
Nevertheless, the practice creates a problem which is intensely
human, and has an important practical bearing on our ability to recruit
and retain men of the requisite calibre for the services. The practice
means that men will in many cases come to the end of their service
careers while still in the early middle years of their lives. In the Air
Force, retirement of officers commence at the age of 41, in the Navy, at
the age of 45 and, in the Army, at the age of 47. Men who leave the
services at such ages have before them the acute personal problem of
finding new occupations in civil life. Since the exigencies of the defence
system impose these conditions of retirement, the Government has a
clear obligation to provide a special scheme of retiring benefits, which
should be sufficient to tide the member over the period of readjustment
and to supplement substantially his earnings in his civil occupation.
Similar considerations apply into a perhaps somewhat lesser degree to ii

S 36
I: men who retire from more senior service positions at a rather higher
but still relatively early age. On the practical side, it has to be
considered that unless provision of this kind is made, the prospect of
early retirement will act as a discouragement to men contemplating
careers in the services.
" I outline existing retirement provisions for the forces. Naval
personnel are credited with deferred pay, payable on the retirement
of the member, or to his estate if death occurs during service. For
officers serving to the full retiring age of their ranks, the cumulative
deferred pay would amount to approximately œ 4,000 for lieutenantcommanders
rising to approximately œ 6,500 for captains. Permanent
personnel of Army are contributors to the Commonwealth Superannuation
Fund and have the same pension cover for themselves and their
dependants as have members of the Commonwealth Public Serv-ice.
" Before the amendment of the Superannuation Act in 1947, the
maximum pension obtainable by any officer at the age of 60 was œ 416
per annum. Under the amendments to the Superannuation Act, there
was a general increase by 23 per cent. of the pensions of all officers and
other ranks, and officers were enabled, according to their rate of salary,
to contribute for a muaximum. pension of œ 345 per annum at the age of
The general effect was that 60 per cent. -of the cost of all pensions
would he provided by the Commonwealth. The Air Force provisions
are not in line with those of either the Navy or the Army. Permanent
Air Force personnel -below officer rank are contributors to the Superannuation
Fund under -conditions similar to those obtaining in the Army.
Air Force officers contribute to the Superannuation Fund to provide
for benefits on death or invalidity during service. The major retirement
provision for these officers is a system of deferred pay which is a
benefit paid to the member on retirement or to his estate if death occurs
during service. The rates of deferred pay are substantially less than
those of Naval personnel of equivalent rank. The review of these
provisions led to the following conclusions-
First-Wide disparities exist between the different schemes.
Secondly-In view of the recent red uction of retiring ages for Army officers
from 55 or 60 to ages ranging fioin 47 years upwards, and even lower retiring
ages in the other services, it is necessary to provide a scheme of pension for
retirements at age 40 or later.
Thirdly-A deferred pay scheme makes inadequate provision for the officer
or his dependants in the event of death or invalidity in the early stage of his
career. Fourtbly-Payn~ ent of deferred pay in a lunmp suni on retirement may lead
to an unwise or unfortunate investment resulting-in the loss of the retirement
benefit. Fifthly-Now that comparable ranks in each service receive generally the
same rates of pay and allowances, it is most desirable that a uniform system of
retirement benefits for all services should be adopted.
" An exhaustive investigation of all aspects of the problem was
made, and recommendations subscribed to by representatives of the
I. three service boards form the basis of the bill.

IIœ 3; The bi provides for a scale o: f pensions to officers rising from
annum for majors, and equivalent ranks in the other services,
up to a maximum of œ 845 per annum. for lieutenant-generals, and equivalent
ranks in the other services, who serve until retirement at age
The maximum pension of œ 845 is also the maximum pension payable
to a member of the Commonwealth Public Service.
" The pension provision in the case of other ranks is based on
twenty years' service after the age 0f twenty, and the rates range from
per annum for able seamen, private or aircraftman, 1st class, to
œ 155 per annuma for a chief artificer, warrant officer 1. ( Army) or
warrant officer ( Air). For service beyond twenty years, the annual
rate of pension increases by œ 6 to œ 8 for each additional year of completed
service. Provision is made in the bill for the payment of a half
pension to the widow, and allowances to the children, on lines similar to
the Superannuation Act. After retirement of the member, the rate
of widows' pension is related to the pension previously payable to the
ex-member. " The existing deferred pay and superannuation schemes cover only
permanent members of the forces. This bill extends pension benefits to
personnel on long-term engagements. Those who do not serve for a
sufficient period to qualify for a pension will be entitled to a refund
of their contributions if their period of service is less than ten years,
although throughout this period they will be covered against death
or invalidity. Where the term of service is in excess of ten years, but
less than twenty years, the member will be entitled to a refund of his
contribution, -plus a gratuity equal to one and a half times the amount
he has contributed. Provision has been made for certain officers who,
because of their late age on entry, cannot complete twenty years' service
for pension before reaching the retiring age for the rank held, to receive
a pension on a reduced scale after the completion of fifteen years' service.
" Naval, Army and Air Force cadets, and all personnel under the
age of eighteen years, will be covered ' by the scheme, but will not be
required to contribute to the fund until attaining the age of eighteen
years. They will not be pensionable until reaching the age of 40 years.
" The existing deferred pay entitlements of Naval and Air Force
members presented particularly difficult problems. These have been
met by granting these members the option to become contributors to
the Defence Forces Retirement Fund, or, alternatively, to retain their
existing rights. The deferred pay of those members who elect to
Ibecome contributors to the fund will be transferred to the new fund
to be established under this act, and the amount so transferred will be
used to reduce their future contributions for pension entitlement. Army
personnel, who are contributors under the Superannuation Act, will be
transferred to the new defence forces retirement scheme on the same
trms and conditions as regard benefits and contibutions as those to
which they are entitled under the Superannuation Act. The reserve
values held on their behalf will be transferred from the Superannuation
Fund to the new fund, and will be available to meet part of the cost

38
of the benefits they will ultimately receive. The contributions of memhbers
of the services will be precisely the same as in the case of the Commonwealth
Public Scrvice, and relate to a member'sa rate of pay, and
the age at which he becomes a contributor or obtains pay increases.
" To finance a scale of pensions such as is proposed for early retirements
in the defence forces wvill entail a much greater government contribution
than in the case of the Commonwealth Public Service superannuation
scheme,' where retirements occur at age 60 or 65. The subsidy
under the Superannuation Fund, namely, 60 per cent. of the cost
of pensions, is inadequate for the retirement fund. On the average,
because of early retirement benefits, the Commonwealth will have to
pay much more than 60 per cent., but because of the impossibility of
forecasting retirement rates, no precise statement can be made of what
the percentage is likely to be. The Commonwealth undertakes to meet
the deficiency between the value of benfits payable and the accumulated
value of the members' contributions. The method followed is similar
to that under the Superannuation Fund. The Commonwealth meets its
liability in respect of each payment of pension or gratuity as it arises.
" No precise information is at present available as to the ultimate
cost of the defence forces retirement scheme, but, based on the present
approved strength of the forces, it is estimated that the annual commitment
may reach œ 2,000,000 in fifteen years' time, and increase comparatively
slowly thereafter. This commitment is much in excess of the
present liability of the Commonwealth in respect of deferred pay andl
superannuation for the forces.
" Provision is made to establish a defence forces retiremeut fund,
administered by a board comprised of the president of the Commonwealth
Superannuation Fund, the Commonwealth Actuary, a representative
of the Treasury, and one from each of the three services. They
will hold office for two years.
" The bill provides for the control and investmnent of the fund under
the direction of the board along lines similar to those provided in the
Superannuation Act. It also -provides that the fund shall be audited
by the Commonwealth Auditor-General; that it shall be valued by the
Commonwealth Actuary every five years, and that the annual report
of the board's operations and a statement of accounts shall be published.
[ The bit was passed.
( For earlier references, please see No. 134, page 6.)
BARLEY POOL.
NO. 9 POOL-SECOND ADVANCE.
On 7th May, 1948, the Minister for Agriculture ( Mr. Pollard)
announced that a second advance of 4s. a bushel less freight on malting
grades and 1s. a bushel less freight on feed grades have been approved
for barley in No. 9 pool. The payment increased advances in the pool
t8s.' 9d. less freight for malting barley and to 4s. 4d. a bushel le3s
freight for feed barley.

39
CONSTITUTION.
AMENDMENT-REFERENDUM, PRICES.
On 10th May, 1948, the Prime Minister ( Mr. Chifley) broadcast
over the national network. Mr. Chifley said-
Fellow citizens,
On Saturday, 29th May, you will be asked to record a simple vote,
either Yes or No at a referendum to indicate whether the Australian
Constitution should be amended to give the Commonwealth Parliament
power to control rents and prices ( including charges).
It is my purp ose to-night to put to you squarely the matter which
you should take into consideration when making your decision.
This is not a matter of politics. This is a matter which affects your
pocket and the welfare of the people and, particularly, of the less
favoured section of the people.
First I will tell you why this referendum is being taken and, secondly,
1 will indicate why the Government thinks that the only efficient method
of operating price control is through the Federal % Government on a
uniform'basis. Thirdly, Il will give you an indication of what I believe
will happen if this referendum is not carried and it is held that the
Commonwealth Government cannot exercise price control.
As you know, price control was first exercised under the compelling
necessity of war and the power was, and is still, exercised uinder the
Defence powers of the Commonwealth. Price control was introduced
because it was realized that rapidly rising prices would throw our
economy completely out of gear and reduce our capacity to make a full
war effort. Price control was then, and is now, a brake on inflation.
The power, as I have mentioned, was exercised under the Defence
power. That power is liable, because the war has ended, to be successfully
challenged. Should such a successful challenge be made, the
whole price-fixing structure would vanish and the people would imme.-
diately be at the mercy of those who are prepared to charge any price
for goods in short supply. To say that the States could pick up the
task of fixing prices is a deliberate attempt to mislead you. The States
have neither the staff, the experience, nor the machinery to undertake
this task. In fact, only two have legislation on the subject.
It was realized after the cessation of hostilities that the price firing
power which was operated under Commonwealth control could be in
danger. Consultations were held with the State Premiers-comp rising both
Labour and conservative Premiers. They agreed unanimously that it
was necessary to continue ' price control. They were anxious to avoid
the ' boom and bust' policy which followed World War IL and which
caused so much unemployment, misery, hardship and degradation in
this country.

In 1946, the Premiers unanimously agreed-subject to their parliaments'
concurrence-to pass legislation which would enable price control
powers to be exercised -by the Commonwealth Government for as long
as shortages of commodities persisted. But hostile legislative councils--
bodies not elected by the people--blocked that effort in some of the
States. Here, briefly, is what h-appened to the Economic Stability
Bill in the various State parliaments-
New South Wales.-The act expires on 31st December next.
Victoria.-The act expired last June, the Legislativ-e Council refusing to
extend it past then.
Queensland-The act continues until a date to be proclaimed.
South Australia.-The act expired l-ast December.
Western Australia.-The act expires next December.
Tasmania-The act expires next month, the Legislative Council refusing to
extend it beyond then.
Without the concurrence of all State parliaments the promise was
nullified. The Queensland and New South Wales Governments were
prepared to give effect to this promise. I believe all the Premiers
were prepared to carry out the promise they made but in some States
the parliaments refused to endorse the promise. Had the States done
their job and provided you with complete insurance -against rising
prices and the grave danger of inflation there would have been no
need for a referendum. Having-tried to give you protection in that
way and failed, the Commonwealth Government is now faced with the
national responsibility of asking you to give it the power to protect
your interest and the national economy.
H I now-come to the second point. Any intelligent Australian will
realize that price control must be operated on a Commonwealth basis
if there is to be uniformity. To have six price-fixing authorities fixing
prices on goods that are manufactured in one State and distributed
into all the other States must appear to any thinking person as
ludicrous. No effective control of prices can be exercised on prices
of goods by a State when those goods have been brought from another
State. A State would have no powver to investigate the cost of producing
such goods. Here is another instance. If one State did not fix the
price of a commodity in its cown State, any other State into which
such a type of goods was sent would not have any guide as to what
price should be fixed.
I have already mentioned that, apart from this difficulty, the States
have neither the experience nor the machinery to undertake the task.
My third point is that if this referendum is not carried and the
power now carried on under the Defence Power is successfully challenged,
there can only be one result-inflationary prices and immediate
demands -by workers for increased wages to overtake the increased cost
of living. And out of all that would he chaos.
There is another aspect of price control I place before you-an
aspect vital in maintaining a stable economy. Without price control
the Commonwealth Government could not continue fully its system
of subsidies that is keeping down the price of a wide range of everyday
commodities. The Commonwealth meets part of the cost of every

pound of butter, tea, potatoes and of every pint of milk purchased by
the Australian consumer. The price of all Australian made woollen
goads and most other items of clothing is much lower because of these
subsidies. I give yrou a few examples of what these consumer subsidies mean
to the family budget and living costs generally. If the Commonwealth
Government were forced to abandon its subsidy plan, the price of tea
would overnight rise by 2s. 6d. to 5s. 3d. per lb.; butter would go up
by Sid. per lb.; milk by Jd. a quart and the price of potatoes would
nearly double. An ordinary three-piece suit would cost another
shoes would go up by 2s. a pair and those who prefer kid shoes would
have to pay 6s. more a pair.
The subsidy of œ 5,500,000 being paid on textiles other than wool is
saving consumers about œ 8,000,000 a year on their clothing bill.-
The farmer would have to pay nearly 50 per cent. more for his
superphosphate. The Commonwealth Government is also paying subsidies on such
items as coal -and coastal shipping freights. These are indirectly
keeping down living costs.
At present the Commonwealth is spending about œ 40,000,000 a year
on these consumer subsidies. The Government has announced that its
object is to remove or reduce many of these subsidies when circumnstances
permit, but in a world of great economic difficulty and inflated
prices, they are being retained for the time being to ease the burden
of consumers. People must realize, however, that if the Commonwealth's power
to control prices failed many of these subsidies would have to be
terminated. The Commonwealth could scarcely accept a position in
which State -authorities had control over the factors which determined
the effectiveness or otherwise of Commonwealth subsidies costing more
than œ C40,000,000 a year.
Some -opponents of the Commonwealth's request that -you vote ' yes'
on May 29th, try to make you believe that the States can themselves
do the job when the Commonwealth's war-time powers run out.
Any wise Australian will realize very quickly that price control
must -be exercised on a Commonwealth-wide basis and could not be
carried out effectively by individual States with separate and differing
systems. As to the catch-cry about Canberra bureaucrats', Commonwealth
price control is decentralized to such a degree that 90 per cent, of the
decisions are made in the States; the whole work being co-ordinated
by the Prices Commissioner at Canberra, where only 12 per cent. of the
total prices staff is stationed. As a matter of interest, Commonwealth
price control costs each Australian exactly one half-penny a week.
I turn now to give you a warning-a warning of what can happen
if Commonwealth control of prices ends. Unhappily, we have a firsthand
example in what has occurred in the United States.

42
I will now give you a picture in figures of what has happened since
V. P. Day. In Australia, the price rise has gone from 22.86 per cent.
on V. P. Day to 86 per cent, to-day. In Britain, where price control is
maintained, the increase has been only from 80.4 per cent. on V. P.
Day to 33.3 per cent. in December, 1947. But in Canada, where
considerable decontrol has -been forced by the proximity of the United
States, the rise has been from 19 per cent, to 42 per cent., and in
the United States from 30 per cent. to the astonishing figure of 66
per cent. Here is what happened in the United States:
Price control, which had been effectively handled during the war
years, was extended until 30th June, 1946. A clamnour was set up to
abolish the system. President Truman decided to lift price control.
In the following 25 days, food prices rose by 25 per cent!
The President put controls back on July 25th, 1946, but pressure
groups maintained their activity and in the following November all
controls were lifted except those on rents, sugar and rice. Some of the
actual price rises since price control lapsed are roast beef from 2s. 1d.
per lb. to 4s. 2d. butter from 3s. 10d. per lb. to 5s. Sjd. cheese froin
2s. 7d. per lb. to 4s. id.; -bacon from 2s. 7d. per lb. to 4s9. 1id.; eggs
from 2s. lid, to 4s. 2d. a dozen.
Food prices in the United States in December last year were 118
per cent. higher than in September, 1930-more than double.
In this talk, I have explained why the referendum on 29th May
became necessary. I have shown that the States cannot, of themselves,
provide Australia with an efficient system. The dangers confronting
Australia have been clearly put to yrou.
I now give you the same assurance as was given to the Australian
Parliament when the bill to enable this referendum to be held was
introduced in November last. The Government does not consider that
it will be necessary to operate price control indefinitely, or to operate
it in the detailed arid complete form to which we have become
accustomed in recent years. Price control is that form is necessary
only in a period of general excess of demand over supply; a condition
which is being steadily removed. As shortages disappear, so can price
control disappear until it will become a reserve power, operating only
when and where it is for the well-being of the national economy.
It would -be utterly impossible for the Federal Government, once
given this direct power to control prices, to use that power to socialize
anything-as is being alleged by anti-price control elements, flow
could price control be used to socialize industry? Only by fixing unpayable
prices which would drive private enterprise out of production.
What then? The Commonwealth Government cannot, under the Constitution,
operate any form of primary or secondary production, except
such things * as munitions and uniforms for its own use. It cannot
engage generally in wholesale or retail trading.

43
So far, in this talk with you, I have dealt almost entirely with
prices as such. Included in the question upon which you are asked to
vote Yes or No on 29th May, is Commonwealth control of rents
and charges.
The power over rents would cover the fixing or pegging of rents
and would include power to provide for the determination of fair
rents and to protect tenants against eviction.
The power would -also apply to rents of goods as well as rents of
land and buildings. It would enable the Commonwealth Parliament
to control and regulate the prices at which property of any kind, including
commodities, are sold.
Charges are specifically mentioned as included in prices to remove
any doubt about charges which are in the nature of prices or rents, but,
in relation to which, the term prices " or " rent may not be
ordinarily used. Examples are the charges for hairdressing or for
board and lodging. Another example would be the charges for the
use of money, or in other wards, interest.
It may be said that the State Governments could control rents.
But it is unlikely that the States would do so at the same time and in
the same way. That was the case after World War I. Under Commonwealth
control, rents rose only 1 per cent. between 1914 and 1918.
But after World War I. ended and Commonwealth control ceased,
rents went up by nearly 50 per cent. -between 1918 and 1929. The
States did not control rents then and it is dangerous to risk another
failure by the States now.
In any event, if rents were allowed to rise in one State, but not in
others, wages would rise in that State above the general level. With
wages, many other costs and prices would rise as well. As a result, the
whole Australian economy would be thrown off balance. In practical
terms, in safe terms, unified control of rents can be secured only
through the Commonwealth Parliament.
I will deal with one other misleading argument advanced by
opponents of a Yes vote on 29th May. It is claimed that, if the
referendum is carried, the Commonwealth would have power to fix
wages and to conscript labour.
The simple answer to that argument is that the Commonwealth has
no industrial power under the Constitution and there is no possibility
whatever that the High Court would regard power over prices
as a power to regulate wages and employment.
Throughout this talk, I have stressed that this. is a simple issue,
arising because of the simple fact that the State Parliaments failed to
carry out the Premiers' undertakings. This is not even a political
issue. Party politics do not enter into it. The State Premiers who
gave the undertaking I have mentioned were a mixture of Labour
and anti-Labour leaders. The Leader of the Opposition ( Mr. Menzies),

Ar
it .44
who is leader of the Liberal party in the Commonwealth Parliament,
is pledged to Commonwealth control of prices. Here is what he said
in giving you his policy at the last Commonwealth elections-
We shall unhesitatingly maintain price control as a means of preventing
inflation during the period in which production is inadequate to meet the demand
for goods which arises from the enormously increased purchasing power of the
people. Mr. Menzies went on to say-
Leot me, speaking for the government which introduced price control within
a week of the outbreak of war, give the lie to those whisperers who tell you that
a Liberal victory will mean an upward leap -in prices. We stand for con-trolled
prices. I make those two quotations to show you that Mr. Menzies and the
Government are of one and the same mind on this question.
I sound one warning note before closing. In the world to-day
peace has yet to be won. The awful cost of war has not yet been aii
The democracies face enormous problems; the peoples of the world who
gave their all to win a little happiness, a better way of life, face grim
prospects. Britain poured out all she had in a war to the bitter end.
To-day, her economic wounds are still bleeding. Australia is determined
to play her part as a member of the British Commonwealth
in the economic struggle now going on. Australia cannot carry out
her part if she be weakened internally. A breakdown in the Australian
economy would be another setback for Britain. I ask you to maintain
Australia's economic stability. I ask you to vote Yes" on 29th May
for your security; for the economic welfare of yourself and your
children.
ji By Authority: L. F. JoNxSTONT, Commonwealth Government Printer, Cabierra.